EXHIBIT 99.1
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AMERICAN RIVER BANKSHARES ANNOUNCES 3rd QUARTER EARNINGS
Sacramento, CA - October 15, 2004 - American River Bankshares (Nasdaq: AMRB),
the parent company of American River Bank, announced financial results for the
third quarter ended September 30, 2004. Net income for the third quarter of 2004
was $1,339,000 ($0.30 diluted EPS) compared to $1,260,000 ($0.29 diluted EPS)
during the third quarter of 2003. The Company's total assets increased by 23.3%
to $456,677,000 at September 30, 2004, compared to $370,260,000 at September 30,
2003. This marks American River Bankshares' eighty-third consecutive profitable
quarter.
Net income for the first nine months of 2004 was up 8.7% to $3,926,000 ($0.89
diluted EPS) from the $3,612,000 ($0.84 diluted EPS) recorded during the first
nine months of 2003. Through the first nine months of 2004, net interest income
increased 10.4% to $13,929,000 up from the $12,622,000 recorded during the same
period in 2003. Noninterest income on a year-to-date basis totaled $1,892,000,
which is a 9.0% increase from the $1,736,000 recorded in the previous year.
Noninterest expense increased 17.2% to $9,026,000 during the nine months ended
September 30, 2004, compared to $7,702,000 in 2003.
Net interest income increased 14.1% to $4,869,000 in the third quarter of 2004
compared to $4,266,000 in the third quarter of 2003. The increase in the net
interest income results from an increase in average loans of $20,869,000 (8.4%)
and an increase in average investment securities of $57,986,000 (82.8%). These
increases were made possible by an increase of average deposits of $59,443,000
(19.4%) and average short-term borrowings of $16,590,000 (73.4%). The net
interest margin decreased from 5.11% in the third quarter of 2003 to 4.78%
during the third quarter of 2004. Noninterest income decreased 31.6% to $441,000
in the third quarter of 2004 compared to $645,000 in the third quarter of 2003.
The decrease in noninterest income for the quarter can be attributed to
decreases in fees from lease brokerage services (down $118,000 or 99.2%) and a
decrease in residential lending fee income (down $80,000 or 74.1%). The decrease
in lease brokerage services resulted from the majority of the third quarter 2004
Company originated leases being recorded on the books of the Company as opposed
to receiving fee income for brokering the leases to outside funding sources. The
residential lending division experienced a decrease in loan volume as a result
of a slight increase in mortgage rates, which caused the number of refinances to
decrease. Noninterest expense increased 8.8% to $2,814,000 for the third quarter
of 2004 compared to $2,587,000 for the third quarter of 2003. The majority of
the increase ($203,000) relates to the cost associated with the new banking
office in Downtown Sacramento.
Total assets at September 30, 2004 were $456,677,000, an increase of $86,417,000
(23.3%) from the $370,260,000 reported as of September 30, 2003. Net loans and
leases totaled $268,001,000 at September 30, 2004; up 6.0% from the $252,758,000
reported as of September 30, 2003. The increase was centered in real-estate
construction and land development, real estate-commercial, lease financing, and
commercial loans. Real-estate construction and land development loans were up
$11,090,000 (37.5%) to $40,685,000 at September 30, 2004, as compared to
$29,595,000 at September 30, 2003. Real estate-commercial loans were up
$6,519,000 (4.6%) to $146,865,000 at September 30, 2004, compared to
$140,346,000 at September 30, 2003. Lease financing increased to $10,164,000
(8.4%) at September 30, 2004 from the $9,373,000 at September 30, 2003.
Commercial loans increased to $57,512,000, up 4.8% from the $54,896,000 reported
as of September 30, 2003.
Page 4 of 8 Pages
Deposits increased by 20.2% to $375,237,000 at September 30, 2004, compared to
$312,166,000 at September 30, 2003, including a 26.0% increase in interest
checking, money market, and savings accounts and a 30.6% increase in noninterest
bearing deposits. A contributing factor to the increase in deposits has been the
successful opening of American River Bank's new full service banking facility in
Downtown Sacramento. The office opened its doors in March of 2004 and by
September 30, 2004 deposits totaled approximately $39,000,000.
American River Bank's Sacramento and Placer County Offices increased deposits
and loans for the third quarter of 2004. Deposits increased to $305,843,000 up
27.8% from the $239,246,000 recorded at the end of the third quarter of 2003.
Loans increased to $198,293,000 (4.7%) from the $189,439,000 recorded at
September 30, 2003.
North Coast Bank, a division of American River Bank, which serves Sonoma County,
had a decrease in deposits to $71,327,000 (3.1%) at September 30, 2004, from the
$73,646,000 recorded at September 30, 2003. Loans increased to $69,708,000
(10.1%) at September 30, 2004, from the $63,319,000 recorded at September 30,
2003.
Non-performing loans and leases were $103,000 or 0.04% of total loans and leases
at September 30, 2004. The allowance for loan and lease losses was $4,496,000 as
of September 30, 2004 which is 1.65% of total loans and leases outstanding.
Year-to-date net charge-offs on an annualized basis were 0.07% of average loans
and leases.
Return on average assets decreased to 1.19% in the third quarter of 2004 from
1.37% in the third quarter of 2003. Return on average equity decreased to 13.96%
for the quarter ended September 30, 2004, from 14.84% in the third quarter of
2003. The efficiency ratio for the third quarter of 2004 increased to 52.56%
from the 52.23% recorded in 2003. For the nine months ended September 30, 2004,
return on average assets decreased to 1.24% from 1.36% in 2003. Return on
average equity decreased to 14.13% for the nine months ended September 30, 2004,
from 14.63% in 2003. The year-to-date efficiency ratio increased to 56.59% in
2004 from 53.19% in 2003.
American River Bankshares is a financial services company and the parent company
of American River Bank, a community business bank that operates a family of
financial service providers. These providers include: American River Bank, with
four offices in Sacramento and one office in Placer County; and North Coast
Bank, a division of American River Bank, with three offices in Sonoma County. In
addition, on July 9, 2004 the Company filed an 8-K with the Securities and
Exchange Commission announcing an Agreement and Plan of Reorganization and
Merger with Bank of Amador in Jackson, California. For further information see
the 8-K filed on July 9, 2004.
On October 7, 2004, the California Commissioner of Financial Institutions
approved the application of American River Bankshares and American River Bank to
merge Bank of Amador with and into American River Bank, in accordance with the
terms of the Agreement and Plan of Reorganization and Merger dated July 8, 2004
among American River Bankshares, American River Bank, and Bank of Amador.
In addition, the Federal Reserve Bank of San Francisco, acting on delegated
authority from the Board of Governors of the Federal Reserve System, approved
American River Bankshares request for an exemption from the requirement of
filing an application under Section 3 of the Bank Holding Company Act of 1956,
as amended, and confirmed that it will not object to the consummation of the
transactions contemplated by the merger agreement, subject to the receipt of
required approvals from the California Department of Financial Institutions and
the Federal Deposit Insurance Corporation.
Page 5 of 8 Pages
An application for approval of the merger is currently pending with the Federal
Deposit Insurance Corporation.
Consummation of the merger and transactions contemplated by the merger agreement
is subject to satisfaction of conditions, covenants and agreements contained in
the merger agreement, and the receipt of approvals of the respective
shareholders of American River Bankshares and Bank of Amador and all applicable
regulatory approvals. A joint proxy statement-prospectus describing the material
provisions of the transaction is anticipated to be mailed to the respective
shareholders of American River Bankshares and Bank of Amador during the fourth
quarter of 2004 and the transaction is expected to close in the fourth quarter
of 2004.
Related websites: www.amrb.com, www.americanriverbank.net,
www.northcoastbank.com
FORWARD-LOOKING INFORMATION
In addition to the historical information contained herein, this press release
contains certain forward-looking statements. The reader of this press release
should understand that all such forward-looking statements are subject to
various uncertainties and risks that could affect their outcome. The Company's
actual results could differ materially from those suggested by such
forward-looking statements. Factors that could cause or contribute to such
differences include, but are not limited to, variances in the actual versus
projected growth in assets, return on assets, loan losses, expenses, changes in
the interest environment including interest rates charged on loans, earned on
securities investments and paid on deposits, competition effects, fee and other
non interest income earned, general economic conditions, nationally, regionally,
and in the operating market areas of the Company and its subsidiaries, changes
in the regulatory environment, changes in business conditions and inflation,
changes in securities markets, data processing problems, a decline in real
estate values in the Company's market area, the conduct of the war on terrorism,
the threat of terrorism or the impact of potential military conflicts and the
conduct of war on terrorism by the United States and its allies, as well as
other factors. To gain a more complete understanding of the uncertainties and
risks involved in the Company's business, this press release should be read in
conjunction with the Company's annual report on Form 10-K for the year ended
December 31, 2003, and subsequent quarterly reports on Form 10Q and current
reports on Form 8-K.
Page 6 of 8 Pages
AMERICAN RIVER BANKSHARES FINANCIAL SUMMARY
CONSOLIDATED BALANCE SHEET (unaudited)
SEPTEMBER 30 SEPTEMBER 30 DECEMBER 31
ASSETS 2004 2003 2003
------------ ------------ ------------
Cash and due from banks $ 41,439,000 $ 26,766,000 $ 29,797,000
Federal funds sold 2,800,000 5,100,000 0
Interest-bearing deposits in banks 5,641,000 4,353,000 4,650,000
Investment securities 128,955,000 73,085,000 91,392,000
Loans and leases, net 268,001,000 252,758,000 262,464,000
Bank premises and equipment 1,734,000 1,586,000 1,505,000
Accounts receivable servicing receivable, net 2,152,000 1,441,000 1,778,000
Accrued interest and other assets 5,955,000 5,171,000 5,807,000
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$456,677,000 $370,260,000 $397,393,000
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LIABILITIES & EQUITY
Noninterest-bearing deposits $126,969,000 $ 97,231,000 $102,308,000
Interest checking, money market & savings 182,322,000 144,753,000 148,578,000
Time deposits 65,946,000 70,182,000 71,621,000
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Total deposits 375,237,000 312,166,000 322,507,000
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Short-term borrowings 36,300,000 19,000,000 34,600,000
Long-term debt 1,902,000 1,955,000 1,942,000
Accrued interest and other liabilities 4,137,000 2,418,000 2,887,000
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Total liabilities 417,576,000 335,539,000 361,936,000
Total equity 39,101,000 34,721,000 35,457,000
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$456,677,000 $370,260,000 $397,393,000
============ ============ ============
Nonperforming loans and leases to total loans and leases 0.04% 0.16% 0.07%
Net charge-offs to average loans and leases 0.07% 0.13% 0.08%
Allowance for loan and lease losses to total loans and leases 1.65% 1.41% 1.48%
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CONSOLIDATED STATEMENT OF INCOME THIRD THIRD FOR THE NINE MONTHS
(UNAUDITED) QUARTER QUARTER ENDED SEPTEMBER 30
2004 2003 2004 2003
------------ ------------ ------------ ------------
Interest income $ 5,672,000 $ 4,953,000 $ 16,141,000 $ 14,825,000
Interest expense 803,000 687,000 2,212,000 2,203,000
------------ ------------ ------------ ------------
Net interest income 4,869,000 4,266,000 13,929,000 12,622,000
Provision for loan and lease losses 266,000 252,000 695,000 664,000
Total noninterest income 441,000 645,000 1,892,000 1,736,000
Total noninterest expense 2,814,000 2,587,000 9,026,000 7,702,000
------------ ------------ ------------ ------------
Income before taxes 2,230,000 2,072,000 6,100,000 5,992,000
Income taxes 891,000 812,000 2,174,000 2,380,000
------------ ------------ ------------ ------------
Net income $ 1,339,000 $ 1,260,000 $ 3,926,000 $ 3,612,000
============ ============ ============ ============
Basic earnings per share $ 0.32 $ 0.32 $ 0.94 $ 0.91
Diluted earnings per share 0.30 0.29 0.89 0.84
Trailing 12-month diluted earnings per share 1.15 1.14
Net interest margin as a percentage 4.78% 5.11% 4.85% 5.21%
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Operating Ratios (through September 30):
Return on average assets 1.19% 1.37% 1.24% 1.36%
Return on average equity 13.96% 14.84% 14.13% 14.63%
Efficiency ratio (fully taxable equivalent) 52.56% 52.23% 56.59% 53.19%
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Earnings per share have been adjusted for a 3 for 2 stock split in 2003.
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CONSOLIDATED STATEMENT OF INCOME
Trailing Four Quarters THIRD SECOND FIRST FOURTH
(Unaudited) QUARTER QUARTER QUARTER QUARTER
2004 2004 2004 2003
------------ ------------ ------------ ------------
Interest income $ 5,672,000 $ 5,356,000 $ 5,113,000 $ 4,943,000
Interest expense 803,000 718,000 691,000 699,000
------------ ------------ ------------ ------------
Net interest income 4,869,000 4,638,000 4,422,000 4,244,000
Provision for loan and lease losses 266,000 231,000 198,000 282,000
Total noninterest income 441,000 1,022,000 429,000 517,000
Total noninterest expense 2,814,000 3,463,000 2,749,000 2,670,000
------------ ------------ ------------ ------------
Income before taxes 2,230,000 1,966,000 1,904,000 1,809,000
Income taxes 891,000 539,000 744,000 680,000
------------ ------------ ------------ ------------
Net income $ 1,339,000 $ 1,427,000 $ 1,160,000 $ 1,129,000
============ ============ ============ ============
Basic earnings per share $ 0.32 0.34 0.28 0.28
Diluted earnings per share 0.30 0.32 0.27 0.26
Net interest margin as a percentage 4.78% 4.85% 4.94% 4.83%
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Quarterly Operating Ratios:
Return on average assets 1.19% 1.36% 1.17% 1.16%
Return on average equity 13.96% 15.45% 12.96% 12.88%
Efficiency ratio (fully taxable equivalent) 52.56% 60.74% 56.15% 55.54%
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Earnings per share have been adjusted for a 3 for 2 stock split in 2003.
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